SAI WARDHA POWER GENERATION LIMITED Vs. TATA POWER COMPANY LIMITED DISTRIBUTION
LAWS(SC)-2020-4-9
SUPREME COURT OF INDIA
Decided on April 03,2020

Sai Wardha Power Generation Limited Appellant
VERSUS
Tata Power Company Limited Distribution Respondents

JUDGEMENT

L.NAGESWARA RAO,J. - (1.)The question that arises for our consideration in these Appeals is whether Tata Power Company Limited-Distribution (hereinafter, 'TPC-D') is entitled to levy wheeling charges for the power supplied to Hindustan Petroleum Corporation Limited (hereinafter, 'HPCL') and wheeling charges for the power sourced from Sai Wardha Power Generation Limited (hereinafter, 'SWPGL') through open access. The Maharashtra Electricity Regulation Commission (hereinafter, 'the Commission') allowed the petition filed by HPCL and held that TPC-D is not entitled to levy wheeling charges. Consequently, the Commission directed TPC-D to refund the amounts collected from HPCL, in the form of wheeling charges. The Appellate Tribunal for Electricity allowed the appeal filed by TPC-D and set aside the order of the Commission. Aggrieved thereby, the SWPGL and HPCL have filed the above Appeals.
(2.)Tata Power Company Limited (TPC was granted an integrated licence for supply of electricity under the provisions of the Indian Electricity Act, 1910. HPCL has been receiving electricity from TPC on its 22 kV distribution network since 1955. In 2005, HPCL augmented its oil refining facility by installing additional units. HPCL requested TPC to supply additional power to feed its load requirement of 70 MW on 100 per cent redundancy basis. The supply was required to be enhanced to extra high voltage (EHV) level. A power supply agreement was executed between TPC and HPCL on 20th October, 2005 for providing power supply of 110 kV to HPCL's expansion project at Chembur. The actual supply of 70 MW power started in the year 2008 after the construction of 2x110 kV facility and the requisite regulatory approvals.
(3.)In the meanwhile, as per the directions of the Commission, TPC trifurcated its assets and segregated them into different entities for generation, transmission and distribution for the purpose of accounting and tariff determination in the year 2006. The Commission determined separate tariffs for Tata Power Company Limited-Generation, Tata Power Company Limited-Transmission and Tata Power Company Limited-Distribution businesses for the first time on 03.10.2006. Thereafter, separate tariffs were determined by the Commission for Tata Power Company Limited-Generation, Tata Power Company Limited-Transmission and Tata Power Company Limited-Distribution. While approving the request for construction of 2x110 kV lines for power supply of 70 MW to HPCL on 16.10.2007, the Commission directed TPC that the other consumers in the vicinity may also be supplied power from the 2x110 kV distribution lines. By the tariff order dated 04.06.2008, the Commission permitted the capitalization of the 2x110 kV distribution lines in the books of accounts of TPC-D. Undisputedly, HPCL has beenpaying wheeling charges i.e. charges for the right to use of the distribution network since 2008.
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