M.KARPAGA VINAYAGAM, J. - (1.) NATIONAL Thermal Power Corporation Ltd(NTPC) is the Appellant.
(2.) AGGRIEVED over the orders impugned dated 21.01.2011 and 15.6.2011 disallowing the NTPC to capitalise the cost of Auto Coal Sampler installed at Singrauli Thermal Power Station, the Appellant has filed this Appeal.
(3.) THE short facts are as follows: i) The Appellant being Central government enterprise is engaged in the business of generation and sale of electricity. It owns and operates a number of generating stations situated in different parts of India. ii) One of the generating stations of the Appellant is Singrauli Super Thermal Power Station located in the state of Uttar Pradesh. iii) The Central Commission approved the tariff of Singrauli Super Thermal Power Station for the period from 01.4.2004 to 31.3.2009 in accordance with the Central Commission's Regulations, 2004. The tariff was revised by the order dated 20.11.2008 by the Central Commission after considering the amount of additional capitalisation incurred for the period 2004 -05 to 2005 -06. iv) The Appellant on 28.8.2009 filed a petition for revision of the said charges on the basis of the impact of additional capital expenditure during the period between 2006 -07 and 2008 -09. v) The Central Commission passed the order allowing certain claims by the order dated 21.01.2011. However it did not allow some of the other claims including the amount of bills amounting to Rs.425.83 lakhs incurred by the Appellant in the year 2008 -09 on installation of Auto Coal Sampler before Crusher. vi) Challenging this order of disallowance of this claim as well as other claims, the NTPC again approached the Central commission and filed a review petition on 4.3.2011. vii) The Central Commission, after hearing the parties, partly allowed the Review Petition on the issues of some claims but did not allow the claim on the expenditure towards the Auto Coal Sampler. viii) As against the said disallowance in respect of the said claim NTPC has filed this Appeal as against both the orders dated 15.6.011 passed in the review petition and the main order dated 21.01.2011. The Learned Counsel for the Appellant while assailing the impugned orders in respect of this claim has urged the following grounds: - (i) According to the terms of Regulation 18(2)(iv) of the tariff Regulations, 2004, the Central Commission has to consider whether the installation of the Auto Coal Sampler before Crusher is necessary for efficient and successful operation of the generating station. So, the duty of the Central Commission would be to find out as to whether Auto Coal Sampler is increasing the efficiency of the operation. The Central Commission cannot be expected to go into the question as to whether the Power Plant can perform even without the said Auto Coal Sampler. When the installation of Auto Coal Sampler facilitates the efficient operation of the generating plant then the capital cost should be considered for additional capitalisation in terms of Regulation 18(2)(iv) of the Regulations,2004. This aspect has not been considered by the Central Commission. (ii) The Central Commission wrongly disallowed the claim by merely considering the performance of the Singrauli Power Station during the past period. The Central Commission cannot conclude that Singrauli Power Station performed well notwithstanding that Auto Coal Sampler was not installed during that period. Hence this conclusion on mere comparison is not correct in view of the fact that the improvement of the efficiency of the generating station with modern techniques is an on -going process. Therefore, this claim should not have been disallowed on the ground of past performance. (iii) The Installation of Auto Coal Sampler was in fact considered by the Central Electricity Authority as a part of Renovation and Modernisation and had been approved in the Renovation and Modernisation scheme. The Central Electricity Authority had examined entire Renovation and Modernisation scheme and specifically approved the installation of Auto Coal Sampler as a part of Renovation and Modernisation. Despite this, the Central Commission wrongly rejected the claim holding that the installation of Auto Coal Sampler was unnecessary for the operation of generating station. (iv) Auto Coal Sampler is to be installed as per the requirement of the Fuel Supply Agreement entered into between the Appellant and Coal Companies for determination of grade of coal in the event of non -availability of Coal Sampler of Coal Company at the mine's end. ;