P.S.DATTA, J. - (1.) THE Appeal Nos. 57 of 2008, 155 of 2007, 125 of 2008, 45 of 2010, 40 of 2010, 196 of 2009, 199 of 2009, 163 of 2010, 144 of 2010 and 6 of 2011 - in all ten in number are being disposed of by this common judgement and order and the following brief narration will suffice to show as to why a comprehensive and analogous treatment is meted out. Background of the Parties
(2.) THE Appeal No. 57 of 2008 has been preferred by SIEL Ltd. (now called Mawana Sugars Ltd.), which was engaged in manufacture of caustic soda and chlorine by electrolytic process, against the Punjab State Electricity Regulatory Commission (Commission, for short) , Punjab State Electricity Board and the State of Punjab respondent numbers 1, 2 and 3 herein respectively against an order dated 17.9.2007 passed by the Commission whereby the Commission determined the ARR for the FY 2007 -08 along with true up exercise for the year 2005 -06 and FY 2006 -07 in respect of the respondent no 2, the PSEB(now called Punjab State Power Corporation Limited). The Appeal no 155 of 2007 has been preferred by the Steel Furnace Association of India, a registered association having its office in Ludhiana of Steel Furnace Units based on all over the country including Punjab against the self -same respondents as in Appeal no. 57 of 2008 and against the self same order and in identical languages. The contentions canvassed in both the appeals are as follows: - 7 (a) Determination of category -wise cost of supply (b) Employees' cost (c) Interest on subsidy and other amount receivable from the State Govt (d) Excess agricultural consumption (e) Applicability of Two Part Tariff (f) Heavy cost of traded power (g) Open Access charges (h) PF surcharge (i) H V Rebate (j) Diversion of capital funds and interest cost (k) Interest element on loans relatable to prior period expenses (l) Non -compliance with the directions of this Tribunal passed in a batch of appeals, being appeal no 4,13,14, 23 etc. of 2005 on 26.5.2006 2.1. Appeal no 125 of 2008 has been preferred against the same set of respondents as in the Appeal nos. 57 of 2008 and 155 of 2007 by SIEL Ltd. , now known as Mawana Sugars Ltd. who is also the appellant in Appeal no 57 of 2008 and Appeal no 40 of 2010 against the order dated 3rd July 2008 passed by the State Commission urging the following issues in respect of ARR of the PSEB for the FY 2008 -09; (a) Determination of the cost of supply (b) Non compliance with the directions of this Tribunal passed in a batch of appeals, being appeal no 4,13,14, 23 etc. of 2005 on 26.5.2006 (c) Cross subsidy (d) Higher purchase cost (e) Excess Open Access charges (f) T&D loss (g) PF surcharge (h) H T Rebate (i) Cost of Ranjit Sagar Dam Project. 2.2. The Appeal No 40 of 2010 has been preferred by Mawana Sugars Ltd. who is also the appellant in Appeal no 57 of 2008 and Appeal no 125 of 2008 against the Commission and the PSEB challenging the order dated 8th September 2009 concerning the ARR and the annual retail tariff for the FY 2009 -10. Appeal no 196 of 2009 has been preferred by Mandi Govindgarh Induction Furnace Association against the Commission and the PSEB being aggrieved against the same order as 8.9.2009 whereby the annual retail tariff for the FY 2009 -10 was determined by the Commission. The Appeal no 199 of 2009 has been preferred by the Steel Furnace Association of India who is also the appellant in Appeal no 155 of 2007 being aggrieved against the order dated 8.9.2009 passed by the Commission in respect of the annual retail tariff of the PSEB for the FY 2009 -10. The Appeal no 45 of 2010 has been preferred by the Govt of Punjab against the Commission and the PSEB feeling aggrieved against the order dated 8.9. 2009 passed by the Commission in respect of the 9 tariff of the PSEB for the FY 2009 -10. The grounds of appeal in Appeal no 40 of 2010, Appeal no 196 of 2009, Appeal no 199 of 2009 and Appeal no 45 of 2010 are almost common and they cover the following issues; (a)Diversion of capital funds to meet revenue expenditure (b)Non -compliance with the directions of this Tribunal passed in a batch of appeals, being Appeal no 4, 13, 14, 23 etc. of 2005 on 26.5.2006 (c)Retrospectivity of the order dated 8.9.2009 (d) T&D Loss (e) Non elimination of cross subsidy (f) LT Surcharge/ HT or EHT Rebate (g) Energy balance (h) Power purchase (i)Agricultural consumption (j)Installation of energy meters (k) Category -wise cost of supply (l) RSD Project cost 2.3. The Appeal no 163 of 2010 has been preferred against the same set of respondents by Mawana Sugars Ltd. who is also the appellant in Appeal nos. 57 of 2008 , 40 of 2010 , and 125 of 2008 being aggrieved with the order dated 23rd April 2010 whereby the Commission determined the tariff of PSEB vis -a -vis the appellant category of consumers for the FY 2010 -11, while the Appeal no 6 of 11 has been preferred by the Govt of Punjab against the Commission and the PSEB(now known as Punjab State Power Corporation Ltd.) against the same order dated 23rd. April 10 2010 in respect of the tariff for the FY 2010 -11 and the grounds of appeal cover the following issues; (a) Determination of category -wise cost of supply (b) Rebate (c) PF surcharge (d) Open Access charges (e) Limit of consumption for the subsidized category of consumers (f) Cross subsidy (g) High power purchase cost (h) RSD Project cost (i)Non - compliance with the directions of this Tribunal passed in a batch of appeals, being appeal no 4,13,14, 23 etc. of 2005 on 26.5.2006 (j)Determination of tariff for agricultural pump set consumers. 2.4 The appeal no. 144 of 2010 has been preferred by M/s Jogindra Castings Private Limited and twenty others who are all industrial consumers under the Punjab Electricity Board, the respondent no. 1 herein against the order dated 23.04.2010 whereby the Commission, the respondent 2 herein determined the tariff of the Board for the FY 2010 -11 alleging some facts common to other appeals. WHY COMMON JUDGEMENT
(3.) THE above narration shows that for the sake of brevity and precision and in order to avoid conflict of decisions a comprehensive treatment is necessary to deal with commonality of the issues. Now, we would proceed to narrate in brief the contentions of the appellants in each of the appeals and the counters of the respondents thereto after which we will frame common issues for consideration. CONTENTIONS OF THE APPELLANT IN APPEAL In Appeal no 57 of 2008 the appellant gives a prelude by mentioning an order dated 26th May 2006 passed by this Tribunal in a batch of appeals being Appeal no. 4, 13, 14, 23 etc. of 2005 and complains that the directions contained in the said order were not complied with by the Commission. This is notably a common grievance of all the appellants in all the appeals and in course of the judgement we will reproduce the relevant extract of the order dated 26.5.2006 so as to examine whether and how far the directions contained in the said order were complied with by the Commission or by the PSEB, (now known as Punjab State Power Corporation Ltd.) as the case may be. 4.1 It is also contended as a prelude by all the appellants in all the appeals that while determining tariff for the successive years beginning from the FY 2007 -08 down to the FY 2010 -11 the principles enunciated in section 61 of the Electricity Act, 2003 were not honoured. 4.2 Now, it is contended that regarding true up exercise for the year 2005 -06 as also for the year 2006 -07 agricultural consumption in excess of the approved levels was not priced at average cost of supply. Again, we are to say here that this is also a ground ventilated in all the memorandum of appeals. Energy consumption was finalized by the 12 Commission at 7317MU as against 7000MU approved for the year 2005 - 06 in the tariff order 2006 -07, while for the year 2006 -07 the Commission finalized the energy consumption by the agriculture sector at 8233MU as against 7115MU approved for the year 2006 -07. Any excess supply of energy to the agriculture sector over and above what was approved by the Commission in its tariff order should have been priced at average cost of supply. 4.3 The Commission did not give effect to the diversion of funds in the true up exercise for the year 2005 -06 which is a violation of the order dated 26.5.2006. It is contended that once the amount of diversion of funds has been determined and the principle for disallowance of the same has been laid down by the Tribunal there was no reason as to why the relative amount of interest on the diverted funds be not disallowed in the FY 2005 -06. 4.4 Thirdly, the amount of Rs.480.73crores being the interest on Government loans had been adopted on the basis of Tariff Order for the year 2004 -05 and for arriving at the figure of Rs.480.73crores, interest element on loan raised for Ranjit Sagar Dam Project (RSD) as relatable to the Irrigation Department (i.e. Rs.580crores @ 12.22% =70.79crores) was reduced for the purpose of finalizing interest cost to be passed on to the consumers. 4.5 Further, it is contended that Respondent No. 1 in its order dated 13.09.07 passed in compliance with the directions of this Tribunal as given in the order dated 26.05.2006 has admitted the amount of loan raised for RSD as pertaining to Irrigation Department to the extent of Rs.1322.62crores instead of Rs.580crores .Accordingly, the respondent No. 1 was duty bound to replace the amount of Rs.580crores with 13 Rs.1322.62crores while doing the true up exercise for the year 2005 -06. The impact of the same would come to Rs.91crores and it would go to reduce the amount of interest cost to that extent. 4.6 Prior period expenses, it is next contended, of Rs.52.66crores should not have been allowed to be the part of the ARR for the year 2005 -06. The PSEB has been paying interest to the State Government on its loan @ 12.22% and an amount of Rs.719.55crores should have been reduced from the amount of loan for the purpose of calculating interest payable by the Board to the State Govt. 4.7 With regard to the ARR for the year 2007 -08 it is contended that despite direction by this Tribunal in its order dated 26.5.2006 the Commission has not determined the category -wise cost of supply as a result of which cross subsidization exceeded its limitations. 4.8 Then, employees' cost should not have been increased unless there was improvement in productivity of employees. In the order dated 26.5.06 this Tribunal directed that the cost of the employees should remain capped at the level of FY 2005 -06. 4.9 With regard to interest on subsidy and other amount receivable from the State Govt it is contended that as the Board was paying interest on the Govt loan alone @ 12.22% an interest on Rs.1009.87 which represents Rs.123.40crores needed to be reduced. It is contended that agricultural consumption continued to be increased from year to year resulting thereby in gradual increase of cross subsidy. 4.10. Further, despite direction by the Commission Two Part Tariff was not made applicable. Power continued to be purchased at high rate 14 putting burden on the consumers. Concept of Open Access was made a failure. 4.11. Charges on account of T&D loss @50% of total normative loss of 20%, wheeling charges @ 25% of the transmission and distribution charges and surcharge in lieu of cross subsidy was wrongly realized . Incentive by way of rebate to compensate in respect of transmission line loss, transformation loss and cost of capital was also not given. ;