P .S.DATTA - (1.) This appeal by Military Engineering Services, Punjab is directed against the order dated 17.9.2007 passed by the respondent No. 1 Punjab State Electricity Regulatory Commission whereby it though considered the appellant's status as a deemed licensee refused to extend to it a differential treatment from other categories of consumers in the matter of tariff structure and thereby allegedly violated provision of section 61 (g) of the Electricity Act.
(2.) IN response to the application for determination of tariff in respect of the respondent No. 2, the Punjab State Electricity Board for the FY 2007 -08, the appellant filed written objections wherein it contended that the appellant was treated as a bulk consumer but it is a deemed licensee within the meaning of section 14 of the Electricity Act and thus the tariff structure in respect of the appellant category should not be like that of commercial or industrial consumer. The Commission is said to have admitted that the appellant is a deemed licensee, yet it treated the appellant at par with the other consumers.
(3.) THE appellant contends as follows: a. The Commission committed an error in not noticing the mandate of section 61(g) of the Act that provides that the tariff should be cost based, mentioning thereby cost of supply would include (a) cost of power, (b) wheeling charges and (c) trading margin. The appellant being a deemed licensee is entitled to be treated differently from bulk supply consumer and the only tariff that the appellant could have been subjected to was cost of supply. b. Section 61(g) of the Act stipulates that cross subsidy component was unavailable to be applied for the appellant as the appellant was not a consumer. -4 - c. The cross subsidy is payable and will apply only in respect of categories of consumers to which the appellant does not fall under. d. Section 2(15) of the Act clearly reveals that the appellant is not a consumer and read with section 2 (39) of the Act it makes it clear that the intentions of the legislators was to treat a consumer differently from the deemed licensee. e. The appellant is a non -profit making organization and is neither industrial nor commercial consumer. The appellant takes the responsibility to construct houses for its employees for residential use and the total load catered to various establishments in the State of Punjab. f. Though the Tribunal by a judgment dated 26.5.2006 in batch of appeals namely 4 of 2005 etc. directed the Commission to determine the cost of supply of electricity to different clauses and categories of -5 - consumers and further directed the State Commission to determine the average cost of supply the Commission failed to do so. g. The objections raised by the appellant incourse of determination of tariff in respect of the respondent No.2 for the FY 2007 -8 in these terms as aforesaid were not considered by the Commission in the impugned order although the Commission was inclined to categorize the appellant as a deemed licensee which is clearly distinguishable from the category of consumers. The Commission ignored the fact that the appellant receives electricity at a single point having one meter and the network required for distribution including transformers/switch gears, etc., are made and constructed at the cost of the appellant and the respondent No. 2 is not to incur any maintenance on that account. Further, there is no scope for T&D losses in respect of transmission of electricity by respondent No. 2 to the appellant. The respondent No. 2, PSEB now designated as Punjab State Power Corporation Ltd. preferred to file a written note of arguments, not an affidavit in reply. Its main contention is that the appellant was not entitled to differential treatment by virtue of it being a deemed licensee because a deemed licensee under the law purchases power directly from the generator and then distributes the power within its area of supply. But as the appellant chooses to purchase power from the distribution licensee like respondent No. 2, it would be treated as a consumer of the distribution licensee regardless of the question whether the purchase of power by the appellant is for own consumption or distribution. There is no provision in the Act to confer upon the appellant a special category, as such, no obligation is cast on the State Commission to determine a differential tariff for the appellant on account of being a deemed licensee.;