- (1.) M/s. Wardha Power Company Ltd.(hereinafter referred to as 'the Petitioner' or 'WPCL') submitted a Petition on 29 October,2013, under Sections 142 and 146 of the Electricity Act, 2003 (hereinafter referred to as the 'Act' or the 'EA 2003') in order to invoke jurisdiction of the Commission over non -compliance by MSEDCL (hereinafter referred to as 'the Respondent No:1') of Orders/directions given by the Commission in the Order dated 28 August,2013 in Case No.117 of 2012. 1.1 The prayers of the Petitioner in its Petition are as under: " a) issue appropriate order or directions under Section 142 against the Respondents by imposing penalties for non compliance of the order/ directions dated 28.08.2013 passed by this Hon'ble Commission in Case No.117 of 2012; b) issue appropriate directions under Section 146 against the Respondent No.2, and any other officials of the Respondent No.1, by imposing punishments for non compliance of the order/ directions dated 28.08.2013 passed by this Hon'ble Commission in Case No.117 of 2012; c) quash the invoices raised by the Respondents (Annexure P -5), containing imposition of cross subsidy surcharge. d) direct the Respondents to issue fresh invoices / bills without the levy of cross subsidy surcharge; e) direct that any cross subsidy surcharge can only be imposed at the end of a financial year, by verifying the generation and consumption criteria on an annual basis, as per the directions issued by this Hon'ble Commission in the order dated 28.08.2013 passed in Case No. 117 of 2012; f) pass such other and further order or orders as this Hon'ble Commission deems fit and proper under the facts and circumstances of the present case."
(2.) The Facts of the Petition submitted by Petitioner are summarized below: 2.1 The Petitioner is a Special Purpose Vehicle (SPV) promoted by a group having knowledge in generation and supply of electricity and the SPV was incorporated as a group Captive Consumer unit. The Petitioner has 4 units of (4X135 MW) out of which Unit No. 3 and 4 were developed as a group Captive Generating Plants to supply power to its members. 2.2 The Petitioner submitted that in order to wheel power to its Captive Consumers, the Petitioner required open access from the Respondent licensee. The Respondent No.1 delayed grant of open access on account of a purported misinterpretation of the provisions of the Electricity Act, 2003(EA 2003) and the Electricity Rules 2005. This delay from the Respondent No.1 to the Petitioner in the event of grant of open access, on account of extraneous reasons, was likely to suffer a loss with respect to Cross Subsidy Surcharge. On account of the said delay in grant of open access, the Petitioner was constrained to institute proceeding before this Commission by filing a Petition, being Case No.161 of 2011. 2.3 Pursuant to the filing of the above Petition, an interim Order was passed by the Commission on 9 December, 2011 directing the Respondent No.1 to issue speaking Order on the open access applications filed by the Petitioner. Thereafter, vide a letter dated 11 January, 2012, Respondent No.1 granted open access to the Petitioner with a direction that it would be in operation from 14 January,2012 or any time thereafter completion of all formalities as per relevant Rules and Regulations. 2.4 The Respondent No.1,having granted open access, on the intervention of this Commission, started levying/imposing Cross Subsidy Surcharge on monthly basis contrary to the provisions of the Electricity Act 2003 (EA 2003), the Petitioner herein was constrained to filed Case No.117 of 2012 urging the Commission to declare the Petitioner as a Captive Generating Plant and consequently to direct the Respondent No.1 to impose Cross Subsidy Surcharge only after verification of generation and consumption data at the end of financial year. 2.5 As per the Rule 3 of the Electricity Rules, 2005, following are the two conditions need to be satisfied in order to qualify as a Captive Generating Plant: i. The Captive Users must hold a minimum 26% ownership in generating company; ii. The Captive Users must consume a minimum of 51 % of the net energy generated by such generating company. In the case the Petitioner, the first criteria of ownership structure has been upheld by the Commission in Final Order dated 28 August, 2013.With regard to determination of second criterion, it is a obligation of the Captive Users to ensure that consumption by the Captive Users of the percentage mentioned is maintained and in case the minimum percentage of Captive use is not complied within any year, the entire electricity generated shall be treated as if it is supplied by a generating company. Therefore, from the aforesaid Rule it becomes clear that Cross Subsidy Surcharge becomes payable only when the minimum consumption percentage on an " annual basis" is lower than 51% of the aggregate electricity generated and consumed for Captive use shall be determined on an "annual basis". Therefore, there was no occasion for the Respondent No.1 to have imposed any Cross Subsidy Surcharge midway before expiry of Financial Year. 2.6 In the light of the above provision of law, this Commission has held as follows in the Order dated 28 August, 2013 in Case No.117 of 2012 "161. Summary of Rulings: ....... ....... ..... ...... 164. With regards to the prayer of the Petitioner in (b), the Commission rules that Cross Subsidy Surcharge shall be levied by MSEDCL after ascertaining the Captive status of Power Plant by verifying the generation and consumption data on annual basis at the end of financial year as per Electricity Rules, 2005. Accordingly the bills revised by MSEDCL and a single bill shall be raised by MSEDCL and a single bill raised for FY 2011 -12 and FY 2012 -13 and for FY 2013 -14 and onwards, the CSS shall be raised on an annual basis. ......... ............ ......... A. Ownership (shareholding with voting rights) of the Captive plant 166. The Commission rules that the change in the ownership (shareholding with voting rights) from what was envisaged at the inception of the Company does not change the character of the CGP, as it is producing power from its Unit III and IV primarily for the use of the Captive Users Order in Case No 164 of 2013 Page 4 who hold not less than 13% of the equity share capital (with voting rights) of the Petitioner Company" 2.7 In Order dated 28 August, 2013, in Case No.117 of 2012, the Commission directed Respondent No.1 to impose Cross Subsidy Surcharge only after verifying the generation and consumption data on an "annual basis" at the end of the financial year as per Rule 3 of the Electricity Rules, 2005. The Commission in the Order dated 28 August,2013 further directed Respondent No.1 that Cross Subsidy Surcharge already levied has to be revised, and a single bill has to be raised upon the Captive users of the Petitioner for FY 2011 -12 and FY 2012 -13 and for FY 2013 -14 and onwards, on an annual basis. 2.8 The Respondents, after passing of the Order dated 28 August, 2013, in Case No.117 of 2012 has still proceeded to issue invoices to the Captive users of the Petitioner imposing Cross Subsidy Surcharge. In the letter dated 4 October, 2013 the Respondent No.1 asked Petitioner to submit certain details with regards to Generation and Consumption of the energy sourced by the Petitioner to its Captive Users. The Petitioner has replied to the same by letter dated 23 October, 2013 stating in unequivocal terms that such verification has to be made at the end of the Financial Year on an "annual basis". The same is the direction given in the Order dated 28 August, 2013 in Case No. 117 of 2012. Therefore, Respondent No.1 is abusing its position, as well as showing scant respect for the Orders passed by the Commission. 2.9 The Petitioner submitted that the Respondent have committed an offence under section 142 of the Electricity Act, 2003 (EA 2003) by deliberately and wilfully not complying with the directions of this Commission. Further, the Respondent No.2 (Chief Engineer Commercial, MSEDCL), who has signed the above mentioned invoices, is also guilty of non -compliance of directions of this Commission under section 146 of the Electricity Act, 2003(EA 2003). 2.10 Petitioner submitted that the entire conduct of the Respondents, before and after the Order dated 28 August, 2013, in Case No.117 of 2012 establishes that the only intent of the said Respondents is to continue charging illegal amount from the Captive users of the Petitioner. The Petitioner stated that Respondents, by wrongful imposition of Cross Subsidy Surcharge, has acted contrary to the Order dated 28 August,2013 as well as the terms of the Electricity Act,2003(EA 2003),the Electricity Rules,2005. 2.11 The Respondent No.1 has filed a Review Petition before this Commission in Case No. 145 of 2013 to review the Order dated 28 August, 2013 in Case No.117 of 2012. The Petitioner submitted that until the said Review Petition is allowed by this Commission with regard to the said Order, the Respondent No. 1 and 2 are in continued violation of the said Order. According to the Petitioner, the filing of the said Review Petition is not an impediment before this Commission to issue Order against both the Respondent under section 142 and 146 of Electricity Act 2003(EA 2003). 2.12 The Petitioner submitted that the present Petition is made bonafide and in the interest of justice. The Petitioner submitted that since Respondents have failed to obey Order of Commission, the Petitioner is compelled to bring all the facts before the Commission so that appropriate Orders can be passed in terms prayed.
(3.) The Commission vide Notice dated 18 December, 2013, scheduled a hearing in the matter on 7 January, 2014. During the hearing, Advocate Arif Bookwala appeared on behalf of Petitioner and Advocate Rahul Sinha appeared on behalf of Respondent.;