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SUPREME COURT OF INDIA
RANJAN GOGOI, R.K. AGRAWAL, JJ.
Punjab State Power Corporation Ltd. – Appellant
Vs.
Punjab State Electricity Regulatory Commission & Ors. – Respondents
Civil Appeal No. 4510 of 2006
Decided On : 10-02-2015
(2012) 6 SCC 782 – Relied upon
(b) Electricity Act, 2003 – Section 61(g) – Principles of determination of tariff – Interest of consumers to be balanced with recovery of cost of electricity in a reasonable manner – Cross subsidy – Originally cross-subsidy was stipulated to be ultimately eliminated – Provision amended to delete “eliminate” – Thus cross-subsidy is to stay but reduced gradually. (Para 6)
(c) Electricity Act, 2003 – Section 61(g) and 62 – Cost of supply and cross-subsidy – National Tariff Policy 2006 – Average cost of supply – Voltage cost of supply – Supply at higher voltage costing less – Average cost of supply to detriment to industrial consumers – Voltage cost of supply more reasonable – Should be aimed at and worked towards – However, for the present application of average cost of supply cannot be faulted with – Judgment of Tribunal justified. (Para 10, 11, 12)
(d) Electricity Act, 2003 – Section 61(g) – Interest cost – Total assets of the utility Rs.9.431.06 crores – Utility availing loan and equity amounting to Rs.11828.48 crores – Rs.4181.90 crores in excess of its capital assets – Obviously this amount diverted to revenue expenditure – Not permissible – Interest on this amount cannot be shifted to consumers – Commission disallowing interest of only Rs.100 crores and allowing balance to be charged to consumers – Tribunal remitting the matter for fuller consideration in subsequent years – in absence of data for the period under consideration the issue cannot be decided – Tribunal rightly giving relief for subsequent years. (Para 13)
(e) Electricity Act, 2003 – Section 61(g) – Employees Cost – Parity with State Government employees – Required at the time of transfer of undertaking – Thereafter must be linked to performance – Utility’s reduction of employee cost only cosmetic – Tribunal limiting employees cost on relevant data – No interference warranted. (Para 17, 18)
(f) Electricity Act, 2003 – Section 61(g) – Coal transit losses – Need to bring own losses stressed by Tribunal – 8% loss allowed as per the CERC norms – Excessive loss reflects inefficiency – Must be eliminated – No interference warranted. (Para 19)
Facts of the case:
Before the learned Appellate Tribunal the tariff orders of the Punjab State Electricity Regulatory Commission dated 30.11.2004 and 14.06.2005 for the financial years 2004-2005 and 2005-2006 were under challenge. Such challenge was both by the present appellant as well as various industrial consumers. By the impugned judgment while the appeals filed by the present appellant have been dismissed, those filed by the industrial consumers have been disposed of with certain directions.
Finding of the Court:
There is no infirmity in the impugned judgment.
Result: Appeal dismissed.
JUDGMENT
RANJAN GOGOI, J.
1. This appeal, against the judgment and order dated 26.05.2006 and 25.07.2006 passed by the Appellate Tribunal for Electricity, New Delhi (hereinafter referred to as the "Appellate Tribunal") was initially filed by the Punjab State Electricity Board (PSEB). Pursuant to a statutory scheme of transfer, vide notification dated 16.04.2010, the PSEB had been unbundled and the functions of generation and distribution came to be vested in the Punjab State Power Corporation Limited (Corporation). By order dated 03.09.2014 the Corporation has been substituted as the appellant in place of the PSEB.
2. Before the learned Appellate Tribunal the tariff orders of the Punjab State Electricity Regulatory Commission (Commission) dated 30.11.2004 and 14.06.2005 for the financial years 2004-2005 and 2005-2006 were under challenge. Such challenge was both by the present appellant as well as various industrial consumers. By the impugned judgment while the appeals filed by the present appellant have been dismissed, those filed by the industrial consumers have been disposed of with certain directions. Aggrieved, the instant appeal has been filed under Section 125 of the Electricity Act, 2003 (for short "the Act") against the aforesaid common order of the Appellate Tribunal.
3. Section 125 of the Act contemplates filing of an appeal to this Court against an order of the Appellate Tribunal on any one or more of the grounds specified in Section 100 of Code of Civil Procedure, 1908. The scope of an appeal to this Court under the aforesaid provision of the Act was considered in DSR (Steel) Pvt. Ltd. Vs. State of Rajasthan [(2012) 6 SCC 782] holding, inter alia, that :
"14. An appeal under Section 125 of the Electricity Act, 2003 is maintainable before this Court only on the grounds specified in Section 100 of the Code of Civil Procedure. Section 100 CPC in turn permits filing of an appeal only if the case involves a substantial question of law. Findings of fact recorded by the courts below, which would in the present case, imply the Regulatory Commission as the court of first instance and the Appellate Tribunal as the court hearing the first appeal, cannot be reopened before this Court in an appeal under Section 125 of the Electricity Act, 2003.
Just as the High Court cannot interfere with the concurrent findings of fact recorded by the courts below in a second appeal under Section 100 of the Code of Civil Procedure, so also this Court would be loath to entertain any challenge to the concurrent findings of fact recorded by the Regulatory Commission and the Appellate Tribunal. The decisions of this Court on the point are a legion. Reference to Govindaraju v. Mariamman[(2005) 2 SCC 500], Hari Singh v. Kanhaiya Lal[(1999) 7 SCC 288], Ramaswamy Kalingaryar v. Mathayan Padayachi[1992 Supp (1) SCC 712], Kehar Singh v. Yash Pal[AIR 1990 SC 2212] and Bismillah Begum v. Rahmatullah Khan[(1998) 2 SCC 226] should, however, suffice."
The challenge in the present appeal, therefore, will have to be considered keeping in mind the principles laid down in DSR (Steel) Pvt. Ltd. Vs. State of Rajasthan (supra) enumerated above.
4. Before proceeding any further it would require a mention that though several issues arise from the judgment and order of the learned Appellate Tribunal, counsel for the appellant has confined his arguments to only four of such issues dealing with the specific claims made by the PSEB thereunder in the application for determination of tariff under Section 62 of the Act. The aforesaid four issues are:-
(i) Cost of supply and cross subsidy
(ii) Disallowance of interest cost on account of alleged diversion of funds
(iii) Disallowance of Employees Cost and
(iv) Coal transit losses.
5. Having regard to the issues calling for an answer, at the outset, a reference to the statement of objects and reasons for enactment of the Act would be appropriate. The objects and reasons are self-explanatory as would be evident on a plain reading of para 1
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