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SUPREME COURT OF INDIA
Kurian Joseph, R. Banumathi, JJ.
Gujarat Urja Vikas Nigam Limited – Appellants
Versus
Solar Semiconductor Power Company (India) Private Limited and Others – Respondents
Civil Appeal No. 6399 of 2016
Decided On : 25-10-2017
(a) Gujarat Electricity Regulatory Commission (Conduct of Business) Regulations, 2004 – Regulations 80, 81 and 82 r/w section 181, Electricity Act, 2003 – Inherent powers of the Commission – Not pervasive as u/s 151, CPC – Available only in areas where Act or Rules are silent – Regulation 81empoweering Commission to adopt a procedure at variance with any other regulations – Section 181 bars any regulation not in conformity with the Act or Rules – Hence tariff decided as per the PPA executed under the Act cannot be varied by the commission under inherent power in Regulations 80 to 82. (Para 32, 33, 34)
(b) Electricity Act, 2003 – Section 61(d) and 64 r/w section 62 – Tariff is determined by Commission after inviting and considering suggestions and objections from public – Can be varied only by same procedure – Not under inherent powers. (Para 35)
(c) Gujarat Electricity Regulatory Commission (Conduct of Business) Regulations, 2004 – Regulation 85 – Control period – Commissioning of project – In terms of obligations under PPA – A matter between the producer and the purchaser – Not a matter under purview of Commission under Regulation 85. (Para 36)
(2016) 11 SCC 182; (2016) 8 SCC 743 – Relied upon
Per R. Banumathi, J. (Concurring)
(d) Electricity Act, 2003 – Section 125 and section 100, CPC – Provision of appeal u/s 125 against order of Appellate Tribunal – Appeal would be maintainable only on the grounds specified in Section 100 of the Civil Procedure Code, 1908 – That is, only if substantial question of law arises for determination. (Para 40)
(e) Administration of justice – Finality of an issue – Extension of control period – State Commission extending the period – Appellate Tribunal setting it aside and remanding the matter for fresh consideration – Supreme Court dismissing appeal in limine directing State commission to decide the matter in accordance with law, not influenced by observations of Appellate Tribunal – Issue still open – Cannot be said to have been settled. (Para 51)
(f) Gujarat Electricity Regulatory Commission (Conduct of Business) Regulations, 2004 – Regulation 80 – Inherent powers – Provision akin to section 151 CPC – Only procedural power – Power to regulate its own procedure – Commission cannot travel beyond its own procedure – Cannot alter terms of PPA. (Para 52, 54)
(2010) 8 SCC 1; (2013) 11 SCC 296 – Relied upon
(g) Electricity Act, 2003 – Section 62 – Commission may re-determine the tariff – It cannot force the parties to enter into a contract based on such tariff – Neither can it vary terms of the contract merely because tariff rate as per Tariff Order (2010) is incorporated in the PPA – Terms of PPA equally bind both parties. (Para 59, 60)
(2016) 11 SCC 182 – Relied upon
(h) Electricity Act, 2003 – Section 94 and Order XLVII Rule 1, CPC – Commission’s power to review its decision – Whether includes power to review tariff – Question left open. (Para 64)
1993 Supp. (4) SCC 595 – Referred
Facts of the case:
The principal question arising in this case is whether the State Electricity Regulatory Commission (the Commission), in exercise of its inherent powers, can extend the control period (the period during which a particular tariff order operates) for Companies like respondent no. 1.
Finding of the Court:
Extension of control period is outside the purview of the power of the Commission.
Result: Appeal allowed.
JUDGMENT
Kurian, J.
The principal question which arises in this case is whether the Gujarat Electricity Regulatory Commission (the Commission), in exercise of its inherent powers, could have extended the control period for the 1st respondent Company (Respondent no. 1). The control period is the period during which a particular tariff order operates.
2. In order to address the issue, certain provisions of the Electricity Act, 2003 (hereinafter referred to as "the Act") are required to be noticed. Part VII of the Act deals with tariff. Sections 61, 62 and 64 of the Act are of particular relevance. :-
"61. Tariff regulations.-The Appropriate Commission shall, subject to the provisions of this Act, specify the terms and conditions for the determination of tariff, and in doing so, shall be guided by the following, namely:-
(a) the principles and methodologies specified by the Central Commission for determination of the tariff applicable to generating companies and transmission licensees;
(b) the generation, transmission, distribution and supply of electricity are conducted on commercial principles;
(c) the factors which would encourage competition, efficiency, economical use of the resources, good performance and optimum investments;
(d) safeguarding of consumers' interest and at the same time, recovery of the cost of electricity in a reasonable manner;
(e) the principles rewarding efficiency in performance;
(f) multi-year tariff principles;
(g) that the tariff progressively reflects the cost of supply of electricity and also reduces cross-subsidies in the manner specified by the Appropriate Commission;
(h) the promotion of co-generation and generation of electricity from renewable sources of energy;
(i) the National Electricity Policy and tariff policy:
Provided that the terms and conditions for determination of tariff under the Electricity (Supply) Act, 1948 (54 of 1948), the Electricity Regulatory Commissions Act, 1998 (14 of 1998) and the enactments specified in the Schedule as they stood immediately before the appointed date, shall continue to apply for a period of one year or until the terms and conditions for tariff are specified under this section, whichever is earlier.
62. Determination of tariff.-(1) The Appropriate Commission shall determine the tariff in accordance with the provisions of this Act for -
(a) supply of electricity by a generating company to a distribution licensee:
Provided that the Appropriate Commission may, in case of shortage of supply of electricity, fix the minimum and maximum ceiling of tariff for sale or purchase of electricity in pursuance of an agreement, entered into between a generating company and a licensee or between licensees, for a period not exceeding one year to ensure reasonable prices of electricity;
(b) transmission of electricity ;
(c) wheeling of electricity;
(d) retail sale of electricity:
Provided that in case of distribution of electricity in the same area by two or more distribution licensees, the Appropriate Commission may, for promoting competition among distribution licensees, fix only maximum ceiling of tariff for retail sale of electricity.
(2) The Appropriate Commission may require a licensee or a generating company to furnish separate details, as may be specified in respect of generation, transmission and distribution for determination of tariff.
(3) The Appropriate Commission shall not, while determining the tariff under this Act, show undue preference to any consumer of electricity but may differentiate according to the consumer's load factor, power factor, voltage, total consumption of electricity during any specified period or the time at which the supply is required or the geographical position of any area, the nature of supply and the purpose for which the supply is required.
(4) No tariff or part of any tariff may ordinarily be amended, more frequently than once in any financial year,
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