Section 19 in Central Electricity Regulatory Commission (Fees and Charges of Regional Load Despatch Centre and other related matters) Regulations, 2019
19. Return on Equity.
(1)Return on equity shall be computed in Rupee terms on the equity base determined in accordance with Regulation 16 of these regulations.(2)Return on equity shall be computed on pre-tax base rate of 15.50% to be grossed up as per the sub-clause (3) of this Regulation.(3)The rate of return on equity shall be computed by grossing up the base rate with the effective tax rate of the respective financial year based on relevant Finance Act.(4)Return on equity with respect to the actual tax rate applicable to the Power System Operation Corporation Limited in line with the provisions of the relevant Finance Acts of the respective year during control period shall be trued up at the end of the control period.(5)Rate of return on equity shall be rounded off to three decimal points and be computed as per the following formula:Rate of pre-tax return on equity = Base rate/ (1-t)Where 't' is the effective tax rate in accordance with sub-clause (3) and regulation 3(15).
